Cuban entrepreneur builds business on American cars
Havana — Julio Alvarez Torres started business with a single refurbished 1955 Chevy Bel Air that had been in his family for decades and put it into service in 2010 driving tourists around the city.
They liked the feeling of going back in time, and Alvarez and other cuentapropistas — self-employed entrepreneurs — liked the fact that the pointy fins, heavy chrome and streamlined hood ornaments of 1950s cars could be put to work to earn them a living.
After the 1959 revolution, Cuba became something of a car museum: the trade embargo made it impossible to import the big American automobiles Cubans loved and economic problems made it difficult to bring in much of anything except Russian-made Ladas and small Fiats. Now other makes of new imported cars are making their way to the island, but they're extremely expensive.
With Russian engines, homemade parts and sheer ingenuity, somehow they kept old American cars chugging through city streets. Others carefully guarded their American cars in garages and only took them out for weekly or even more infrequent spins.
Cuba has allowed limited self-employment since the early 1990s, but in 2010 when the government began emphasizing self-employment as a way to reduce bloated state payrolls, the old cars became a hot commodity.
Now lines of big-finned beauties, 1950s convertibles and two-tone models buffed to a gleaming shine wait outside the Hotel Nacional and other Havana tourist hotels to take visitors for spins along the Malecon, pick them up or drop them at the airport or ferry them to attractions and business appointments.
Alvarez began by parking his car outside the Hotel Nacional and offering his services as a taxi driver, but now he has taken the nostalgia craze to a whole new level.
Today, he and his wife, Nidialys Acosta, oversee a fleet of 22 classic private cars and drivers that form a loose association called NostalgiCar. Alvarez also has started an off-shoot called Garaje NostalgiCar, a garage that refurbishes vintage cars and employs eight workers. He calls the garage, which has refurbished his own cars and those of others, his Plan B.
The couple owns two of the fleet cars, a 1955 blue Chevy Bel Air and a 1956 pink-and-white Bel Air called Lola that could possibly be the most photographed classic car in Cuba. New York Gov. Andrew Cuomo sat behind Lola's pink steering wheel during an April business mission to Cuba as the cameras whirred.
When Alvarez lifted Lola's hood to show the governor the old engine had died and been replaced by a four-cylinder Toyota diesel engine, Cuomo said seeing a Chevy with a Toyota engine was a first for him.
Lola is a looker with whitewall tires and pink rims, pink and white plastic-covered upholstery and even lipstick-pink car locks. But another silver-gray 1956 Bel Air in the fleet has its original engine and a big-cat purr that makes Lola seem like a kitten.
Alvarez says he's constantly in touch with the government about possibly turning NostalgiCar into a cooperative. Many formerly state-run beauty salons, barbershops and other service companies have been turned over to their workers who run them independently on a profit-and-loss basis as the government seeks to pare state payrolls.
But so far he hasn't had a positive response, so each driver/owner is an individual cuentapropista. "Today we're not a company or a cooperative," Alvarez said. "There's not the legal framework to do what we want." But he's content to leave the structure of the garage as it is because he said he doesn't think the employees are prepared to become his partners and so far all the investment has been his capital.
Most of the other NostalgiCar owners reinvest about 70 percent of what they earn into their automobiles, and with the remaining 30 percent, "they live better than any state worker," said Alvarez.
Alvarez, who studied mechanical engineering, first joined forces with five friends who also had classic cars. NostalgiCar grew quickly from five classic cars to 11 to 22.
But Alvarez said his dream is to have a company that provides services with a fleet of cars that he has refurbished and owns and that has drivers that he employs. "Right now I am preparing for the future," he said.
Even though Alvarez and his wife get no commissions from the other drivers in the NostalgiCar group, he said working collectively helps them get volume and name recognition.
The early name of the association was Renta Clasico Chevrolet, but when they tried to register it, they, of course, found they couldn't because the Chevrolet trademark was taken.
After that, they came up with the NostalgiCar name, which they are in the process of trying to register in the United States as well.
A big break came in November 2013, when the Ministry of Tourism allowed the owners of classic cars to sign contracts with state tourism agencies for transportation services.
But in April, he said, the ministry revoked the resolution. It has been resubmitted and Alvarez said car owners are once again allowed to sign contracts with the state.
Meanwhile, NostalgiCar keeps banging up against market barriers that hamper growth and profits. "There are millions of difficulties and obstacles," said Alvarez. "It's a country that's constantly changing, looking to find its way without renouncing our values."
Although new U.S. regulations allow some products produced by private Cuban entrepreneurs to be exported to the United States, refurbished cars aren't included on the list of permissible products.
Then there's the problem of getting the parts needed to bring the cars back to their glory days.
Parts are hard to get in Cuba, so Alvarez often turns to Danchuk Manufacturing, a Santa Ana, Calif., company that makes 1955-1957 Chevrolet replacement parts, MAC's Antique Auto Parts in Lockport, N.Y., and even eBay.
NostalgiCar has a preference for Chevys, but the fleet also includes some Fords and other makes.
Old junkers, which cost $6,000 to $7,000, come into the garage and after a year or so, they emerge as "very pretty" machines, Alvarez said.
As Alvarez walks through the garage pointing out works in progress — a 1959 Chevy Impala with a Mercedes engine that will be finished in a few weeks and even a child-size blue classic car that he plans to refurbish for his son — he admits renovating the vehicles takes every bit of ingenuity he can muster.
And he grows very fond of them during the restoration process. "It's like having to amputate a part of your body if you have to sell them," he said.